Mobile Data Usage and the True Drivers of Customer Satisfaction

If telcos don’t discover more efficient and effective ways to optimize their networks, they will be in jeopardy of losing customers and profits. Telcos today invest millions to provide ubiquitous high speeds—without understanding what actually satisfies customers.

In reality, customers only need high speeds at certain locations, and their satisfaction depends on more than speed alone. Factors like latency and handset hardware have a bigger impact than many telcos think. Knowledge like this will guide optimization efforts and investments, allowing stakeholders to focus on the most impactful areas: the customer experience and the bottom line.

Contrary to popular belief, speed is not everything to consumers of mobile devices. BCG unearthed the true drivers of satisfaction.

Share

Share

Working with key telco stakeholders around the world, BCG uncovered important—and surprising—insights about usage and customer satisfaction.

The BCG Method

BCG does not take the conventional approach to discovering mobile customer insights. We garner a deep, essential understanding of how customers use mobile devices and apply that knowledge to crucial business decisions.

To accomplish this, we go directly to the source: the customers. Our proprietary solution captured a wealth of information about 1500 volunteers who installed it—what apps they use, at what time, and over what type of network. We also captured levels of latency and throughput.

Next, we measured satisfaction. We utilized unique in-the-moment surveys that appeared on screens almost immediately after a usage session. The real-time check-ins allowed us to correlate satisfaction with actual network performance as recorded by the app—revealing what truly affected customer experience.

Low Customer Lifetime Value (CLV) males—who generally have low incomes or are very price-sensitive—are the heaviest data users. The high-CLV group is not only more lucrative but also less taxing on cellular networks. BCG’s research demonstrates that it's smart to steer investments to serve the high-CLV segment.

Customers on unlimited plans use twice as much cellular data as customers on limited plans—and most unlimited plans fail to monetize this increase. When telcos have a significant portion of their customer bases on unlimited plans, the shift to cellular drives an unnecessarily high cost-to-serve model. This puts them at a disadvantage relative to telcos with capped data plans.

Carriers that facilitate Wi-Fi offloading reap the rewards of their efforts. Telcos that convert in-home Wi-Fi routers into local hot spots offload high percentages of traffic to Wi-Fi. Conversely, telcos that lag in their offloading optimization see the highest percentages of use on cellular. They would do well to redouble their efforts.

One surprising finding of our research is related to the speed that apps require. We found that on smartphones, video apps require slower speeds than expected. Other applications—like games, audio, and social networks—operate at even lower speeds.

Viewing video over a cellular network often requires less than one megabit per second—a level that is easily attainable on most modern mobile networks. Telcos may be able to step back from the speed race while keeping customers happy and making sure they come back.

Customer satisfaction increases as latency decreases, meaning cellular carriers should intensify their efforts to reduce network congestion. At the same time, they need to educate consumers on why latency matters. Each carrier should demonstrate that it is doing a better job on this front than its competitors are. Promotional brochures may not be as eye-catching as those that focus on speed, but the payoff could be much greater.

How can networks and applications be optimized to provide not only a smooth and seamless experience but also the experience that customers want most? And how can this be done without incurring huge costs?

The Boston Consulting Group is an Equal Opportunity Employer. All qualified applicants will receive consideration for employment without regard to race, color, age,religion, sex, sexual orientation, gender identity / expression,national origin, protected veteran status, or any other characteristic protected under federal, state or local law,where applicable.

This website uses cookies to improve functionality and performance. If you continue browsing the site, you are giving implied consent to the use of cookies on this website. See our Cookie Policy for details.